Correlation Between Svenska Handelsbanken and Essity AB
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By analyzing existing cross correlation between Svenska Handelsbanken AB and Essity AB, you can compare the effects of market volatilities on Svenska Handelsbanken and Essity AB and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Svenska Handelsbanken with a short position of Essity AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Svenska Handelsbanken and Essity AB.
Diversification Opportunities for Svenska Handelsbanken and Essity AB
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Svenska and Essity is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Svenska Handelsbanken AB and Essity AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Essity AB and Svenska Handelsbanken is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Svenska Handelsbanken AB are associated (or correlated) with Essity AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Essity AB has no effect on the direction of Svenska Handelsbanken i.e., Svenska Handelsbanken and Essity AB go up and down completely randomly.
Pair Corralation between Svenska Handelsbanken and Essity AB
Assuming the 90 days trading horizon Svenska Handelsbanken AB is expected to generate 1.23 times more return on investment than Essity AB. However, Svenska Handelsbanken is 1.23 times more volatile than Essity AB. It trades about 0.06 of its potential returns per unit of risk. Essity AB is currently generating about 0.02 per unit of risk. If you would invest 11,512 in Svenska Handelsbanken AB on November 2, 2024 and sell it today you would earn a total of 5,108 from holding Svenska Handelsbanken AB or generate 44.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Svenska Handelsbanken AB vs. Essity AB
Performance |
| Timeline |
| Svenska Handelsbanken |
| Essity AB |
Svenska Handelsbanken and Essity AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Svenska Handelsbanken and Essity AB
The main advantage of trading using opposite Svenska Handelsbanken and Essity AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Svenska Handelsbanken position performs unexpectedly, Essity AB can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Essity AB will offset losses from the drop in Essity AB's long position.| Svenska Handelsbanken vs. Svenska Handelsbanken AB | Svenska Handelsbanken vs. Nordea Bank Abp | Svenska Handelsbanken vs. Atlas Copco AB | Svenska Handelsbanken vs. Skandinaviska Enskilda Banken |
| Essity AB vs. Svenska Cellulosa Aktiebolaget | Essity AB vs. ASSA ABLOY AB | Essity AB vs. AB Electrolux | Essity AB vs. AB SKF |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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